Corporate Information

News Release

Printer Friendly Version   View printer-friendly version << Back
CPSI Announces Second Quarter 2015 Results

Company Announces Regular Quarterly Cash Dividend of $0.64 Per Share

MOBILE, Ala.--(BUSINESS WIRE)--Jul. 30, 2015-- Computer Programs and Systems, Inc. (NASDAQ: CPSI):

Highlights:

  • Revenues of $47.1 million;
  • 12-month backlog of $170.0 million;
  • Earnings per diluted share of $0.52;
  • Cash provided by operations of $3.8 million; and
  • Quarterly dividend of $0.64 per share.

Computer Programs and Systems, Inc. (NASDAQ: CPSI), a leading provider of healthcare information solutions, today announced results for the second quarter and six months ended June 30, 2015.

The Company also announced that its Board of Directors has declared a regular quarterly cash dividend of $0.64 (sixty-four cents) per share, payable on August 28, 2015, to stockholders of record as of the close of business on August 13, 2015.

Total revenues for the second quarter ended June 30, 2015, were $47.1 million, compared with total revenues of $53.1 million for the prior-year second quarter. Net income for the quarter ended June 30, 2015, was $5.9 million, or $0.52 per diluted share, compared with $9.1 million, or $0.81 per diluted share, for the quarter ended June 30, 2014. Cash provided by operations for the second quarter of 2015 was $3.8 million, compared with $1.3 million for the prior-year second quarter. Cash collections for the second quarter ended June 30, 2015, were $48.3 million, compared with cash collections of $51.5 million for the prior-year second quarter.

Total revenues for the six months ended June 30, 2015, were $93.3 million, compared with total revenues of $105.1 million for the prior-year period. Net income for the six months ended June 30, 2015, was $11.4 million, or $1.01 per diluted share, compared with $16.8 million, or $1.50 per diluted share, for the six months ended June 30, 2014. Cash provided by operations for the first half of 2015 was $17.4 million, compared with $14.5 million for the prior-year period. Cash collections for the first half of 2015, were $97.7 million, compared with cash collections of $101.5 million for the prior-year period.

CPSI’s 12-month backlog as of June 30, 2015, was $170.0 million, consisting of $34.4 million in non-recurring system purchases and professional services and $135.6 million in recurring payments for support, Business Management Services, Cloud EHR Contracts and professional services.

The Company is lowering previously issued guidance for full year 2015 and now anticipates total revenues of $188 million to $192 million and net income of approximately $23.2 million to $24.5 million, or $2.05 to $2.17 per diluted share.

Commenting on the second quarter and the guidance revision, Boyd Douglas, president and chief executive officer of CPSI, said, “2015 continues to be a difficult year for the generation of system sales revenue in the community hospital marketplace. At this time, we expect the system sales environment to remain challenging through the first half of 2016. We believe there will be significant opportunities for Evident sales growth within both new client, legacy replacement sales and add-on software sales to existing customers resulting from CMS Meaningful Use Stage Three requirements, when finalized. We are also excited about the potential for Evident within Canada, where we continue to make headway in our efforts to bring a reasonably priced EHR alternative to the Canadian community hospital marketplace.”

In closing, Douglas added, “On a positive note, TruBridge continues to perform exceptionally well, with record 17% year-over-year quarterly revenue growth as well as improved margins over the first quarter of 2015. Consequently, with the recurring nature of TruBridge revenue, combined with more of our hospital customers choosing our Evident cloud-based EHR solutions, we expect recurring revenue to represent more than 80% of total revenue by 2019.”

CPSI will hold a live webcast to discuss second quarter 2015 results on Thursday, July 30, 2015, at 4:30 p.m. Eastern Time. A 30-day online replay will be available approximately one hour following the conclusion of the live webcast. To listen to the live webcast or access the replay, visit the Company’s website, www.cpsi.com.

About CPSI

CPSI is a leading provider of healthcare solutions for community hospitals. Founded in 1979, CPSI is the parent of two companies – Evident, LLC and TruBridge, LLC. Evident provides comprehensive electronic health record (EHR) solutions for community, rural, and critical access hospitals. TruBridge focuses exclusively on providing business, consulting, and managed IT services to rural and community healthcare organizations, regardless of their IT vendor. For more information, visit www.cpsi.com, www.evident.com, or www.trubridge.com.

This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified generally by the use of forward-looking terminology and words such as “expects,” “anticipates,” “estimates,” “believes,” “predicts,” “intends,” “plans,” “potential,” “may,” “continue,” “should,” “will” and words of comparable meaning. Without limiting the generality of the preceding statement, all statements in this press release relating to estimated and projected sales, earnings, margins, costs, expenditures, cash flows, growth rates and future financial results, as well as our expectations for growth in Canada, are forward-looking statements. We caution investors that any such forward-looking statements are only predictions and are not guarantees of future performance. Certain risks, uncertainties and other factors may cause actual results to differ materially from those projected in the forward-looking statements. Such factors may include: overall business and economic conditions affecting the healthcare industry; government regulation of the healthcare and health insurance industries; government regulation of our products and customers, including changes in healthcare policy affecting Medicare and Medicaid reimbursement rates and qualifying technological standards; the potential effects of the federal healthcare reform legislation enacted in 2010, and implementing regulations, on the businesses of our hospital customers; the funding uncertainties associated with and potential expenditures required by the American Recovery and Reinvestment Act of 2009 in connection with the adoption of electronic health records; saturation of our target market and hospital consolidations; changes in customer purchasing priorities, capital expenditures and demand for information technology systems; competition with companies that have greater financial, technical and marketing resources than we have; failure to develop new technology and products in response to market demands; fluctuations in quarterly financial performance due to, among other factors, timing of customer installations; failure of our products to function properly resulting in claims for medical losses; changes in accounting principles generally accepted in the United States; breaches of security and viruses in our systems resulting in customer claims against us and harm to our reputation; potential intellectual property claims against us; general economic conditions, including changes in the financial and credit markets that may affect the availability and cost of credit to us or our customers; interruptions in our power supply and/or telecommunications capabilities and other risk factors described from time to time in our public releases and reports filed with the Securities and Exchange Commission, including, but not limited to, our most recent Annual Report on Form 10-K. We also caution investors that the forward-looking information described herein represents our outlook only as of this date, and we undertake no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this press release.

       

COMPUTER PROGRAMS AND SYSTEMS, INC.

Unaudited Condensed Consolidated Statements of Income

(in thousands, except per share data)

 
Three Months Ended

June 30,

Six Months Ended

June 30,

2015     2014 2015     2014
Sales revenues:
System sales $ 12,268 $ 20,663 $ 24,853 $ 41,117
Support and maintenance 18,542 18,454 37,074 36,699
Business management, consulting and managed IT services   16,276     13,936     31,399     27,332  
Total sales revenues 47,086 53,053 93,326 105,148
 
Cost of sales:
System sales 10,641 11,293 20,451 22,486
Support and maintenance 6,842 7,127 14,002 14,501
Business management, consulting and managed IT services   9,927     9,455     19,891     18,547  
Total cost of sales   27,410     27,875     54,344     55,534  
Gross profit 19,676 25,178 38,982 49,614
 
Operating expenses:
Sales and marketing 3,271 3,634 6,304 7,598
General and administrative   8,019     7,475     16,458     15,960  
Total operating expenses   11,290     11,109     22,762     23,558  
 
Operating income 8,386 14,069 16,220 26,056
Other income   115     67     198     26  
Income before taxes 8,501 14,136 16,418 26,082
Provision for income taxes   2,597     5,030     5,007     9,261  
Net income 5,904 9,106 11,411 16,821
Less: Net income attributable to participating securities (unvested restricted stock)   (120 )   (144 )   (253 )   (253 )
Net income attributable to common stockholders $ 5,784   $ 8,962   $ 11,158   $ 16,568  
 
Basic and diluted earnings per share $ 0.52   $ 0.81   $ 1.01   $ 1.50  
 
Weighted average shares outstanding used in basic and diluted per common share computations 11,079 11,022 11,066 11,014
 

       

COMPUTER PROGRAMS AND SYSTEMS, INC.

Condensed Consolidated Balance Sheets

(in thousands, except per share data)

 
June 30,

2015

Dec. 31,

2014

(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 26,249 $ 23,792
Investments 10,788 10,703

Accounts receivable, net of allowance for doubtful accounts of $1,153 and $1,253, respectively

21,981 23,102
Financing receivables, current portion, net 13,034 18,112
Inventories 1,353 1,431
Deferred tax assets 2,233 2,319
Prepaid income taxes 2,529 1,120
Prepaid expenses and other   2,016   937  
Total current assets 80,183 81,516
 
Property and equipment, net 15,660 17,039
Financing receivables, net of current portion 1,827 770
Deferred tax assets   181   -  
Total assets $ 97,851 $ 99,325  
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 4,868 $ 3,990
Deferred revenue 4,688 5,891
Accrued vacation 4,060 3,931
Other accrued liabilities   3,870   4,349  
Total current liabilities 17,486 18,161
 
Deferred tax liabilities - 383
 
Stockholders’ equity:
Common stock, par value $0.001 per share, 30,000 shares authorized, 11,303 and 11,209 shares issued and outstanding, 11 11
Additional paid-in capital 41,606 38,983
Accumulated other comprehensive income (loss) 6 (19 )
Retained earnings   38,742   41,806  
Total stockholders’ equity   80,365   80,781  
Total liabilities and stockholders’ equity $ 97,851 $ 99,325  
 

       
COMPUTER PROGRAMS AND SYSTEMS, INC.
Unaudited Other Supplemental Information

(In thousands)

 

The following table summarizes cash flow and free cash flow for the Company:

 

 
 
Three Months Ended

June 30,

Six Months Ended

June 30,

2015     2014 2015     2014
Cash Flow Information
Net cash provided by operating activities $ 3,779 $ 1,316 $ 17,415 $ 14,473
Net cash used in investing activities (207 ) (229 ) (491 ) (235 )
Net cash used in financing activities (7,290 ) (6,342 ) (14,468 ) (12,673 )
 
Free Cash Flow
Net cash provided by operating activities $ 3,779 $ 1,316 $ 17,415 $ 14,473
Less: Purchases of capital assets   (125 )   (177 )   (447 )   (256 )
Free cash flow $ 3,654   $ 1,139   $ 16,968   $ 14,217  
 

Free cash flow is a non-GAAP financial measure which CPSI defines as net cash provided by operating activities less purchases of capital assets. The most directly comparable GAAP financial measure is net cash provided by operating activities. The Company believes free cash flow is a useful measure of performance and uses this measure as an indication of the financial resources of the Company and its ability to generate cash.

Source: Computer Programs and Systems, Inc.

Computer Programs and Systems, Inc.
Boyd Douglas, 251-639-8100
President and Chief Executive Officer